High tech’s diversity problem

  Written by Louis Gudema

Mark Zuckerberg and Facebook employees

This week The New Yorker published a letter I wrote about the lack of diversity in high tech. (Note that in the last line of the letter I wrote that solutions “are even more unlikely”, which The New Yorker changed to “are highly unlikely”, which is not a trivial change.) However, to the broader point, I was responding to the comment by  entrepreneur Joe Green who is quoted in the “California Screaming” article as saying about Silicon Valley, “If there’s anything that reflects the spirit of the Valley, it’s having a meritocracy, and the idea that anyone should be able to rise up through the system.” In this post I elaborate beyond the letter on tech’s diversity problem.

The tech community likes to think of itself as being very progressive: it is innovative and disruptive; uses the latest technologies, gadgets and apps; and optimizes growth with data-driven marketing and sales. That’s all good.

But when it comes to the diversity of its workforce, tech is still stuck in the mid-1950s.

recent report shows that Silicon Valley companies have far fewer female executives and board members than major companies in other industries. Twitter was justifiably criticized for not having a single female board member when they announced their IPO; they named their first one, Marjorie Scardino, in December.

Almost all of the racial diversity in tech companies is from Asians; overall there are very few Blacks or Hispanics despite some notable, individual successes . Even for Asians their participation tends to peak in the professional ranks and decline at the manager and executive levels.

Although women have headed a few of the biggest tech companies, such as IBM, HP, and eBay, and Sheryl Sandberg is central to Facebook’s management, for most tech companies it’s a different picture. And this problem starts at the roots of the money tree where only 4% of the investment decision-makers in VC firms are women. The Grommet co-founder and CEO Jules Pieri says that when she goes to a VC office or event, “I feel like I’ve stepped back into 1969. They are so extremely sheltered from the current business population and creative class that they don’t realize their own isolation.” In many firms this culture continues to the core of the engineering team where female software engineers face significant, sometimes disgusting, cultural barriers.

And you don’t have to look any farther than the group employee pictures on many tech company careers pages to see how interested the industry is in hiring people with grey hair.  (Not many women or people of color in this photo, either…)

Facebook careers page group shot

Why does having a diverse workforce of skilled people matter?

For the individuals it’s very important. Nobody should be denied a chance at professional advancement because of their gender, race, ethnicity, age, sexual preference, or any other factor besides ability.

For the companies it should be a no-brainer: diversity leads to survival. Diversity is likely to bring in knowledge and attitudes that a homogeneous culture doesn’t. If you’re discriminating against people from any group, whether consciously or unconsciously, you’re cutting out a pool of talented people who could help your business.

Now there are some people who are going to deny that this is even an issue: that if the tech workforce is overwhelmingly young, white, males that’s because they’re the best and the brightest. But that’s just not supported by the data. As a six-foot-five-inch friend of mine says, the fact that tall people make more money than short people shows how far we are from being a true meritocracy. People with African-American sounding names on their resumes get called in for far fewer job interviews than people with more Anglo-Saxon sounding names. When “blind” auditions were introduced for orchestras, where the performer sits behind a screen so their gender, race, and appearance are hidden, the number of women winning competitions for open seats dramatically increased.

And if you think that the success of companies like Facebook, Google, and a few others is vindication of the status quo just remember that, as in all business, the vast majority of high tech start-ups fail.

I once heard a simple formula for hiring: When you’re hiring there are only three questions that you really need to answer:

  • Can the person do the job? (Do they have the skills, experience, etc?)
  • Do they want to do the job? (Are they enthusiastic about this job and your company, or are they just looking for a paycheck?)
  • Will they fit in?

And that of the three, the last question is the most important.

The last question is the most important when it comes to diversity, too, because having a narrow definition of “fitting in” is the difference between a homogeneous and a diverse workforce.

At the time that I sold my company Magic Hour Communications in 2009 it was a majority minority firm. I defined “fitting in” as being skilled and experienced, with a positive outlook and the ability to work well with others. On their “How We Hire” page, Google calls it “Googleyness” and says, “we’ll be looking for signs around your comfort with ambiguity, your bias to action and your collaborative nature.”

But when it comes down to choosing between similarly-qualified applicants, many managers hire for totally subjective reasons, such as which people have similar interests to theirs, including leisure interests like sports. Being the “right” age, gender, race, sexual orientation, religion, etc. should not be part of “fitting in”.

Now you can’t expect every small company to have a perfect demographic balance. At Magic Hour we were not always a majority minority company, and our percentage of female employees, for example, could change significantly with just a few hires. But as an industry high tech can do much, much better.

America is an amazingly diverse country, and becoming more and more diverse in every way. About half of the labor force is female. We’re expected to become a majority minority nation in a few decades. Same-sex marriage is not just legal in 17 states (up from 0 ten years ago), but is supported by 65% of 18-29 year olds – 72% of Americans say it is “inevitable”. Older workers will be critical for filling many projected skilled workforce shortages.

All companies need to not just tolerate but celebrate diversity. Even those in high tech.